CH 9 Individual Health Insurance Policy General Provisions Flashcards

1
Q

What health policy provision defines the insured’s duty to provide the insurer with reasonable notice in the event of a loss?

A

Notice of claim.

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2
Q

What is the name of the act by the insured to voluntarily give up insurance?

A

Cancellation.

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3
Q

What health policy provision prevents the insured from bringing a lawsuit against the insurance company for at least 60 days after proof of loss is provided?

A

Legal actions.

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4
Q

What will happen to a health insurance policy if the premium has not been paid by the end of the grace period?

A

The policy will be canceled.

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5
Q

What renewability provision will most likely appear on a travel accident policy?

A

Period of time.

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6
Q

If the insured pays a monthly premium for health insurance, how long would the grace period be on the policy?

A

10 days.

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7
Q

What health policy provision allows the insured a period of time to examine the policy and determine whether or not to keep it?

A

The free look period.

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8
Q

What health policy renewability provision allows the insurer to terminate coverage for any reason, and to increase the premiums for any class of insureds?

A

Optionally renewable.

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9
Q

Under an individual disability income policy, the benefits must be paid on at least what schedule?

A

Monthly.

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10
Q

What health policy provision describes the insureds right to cancel coverage?

A

Renewability provision.

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11
Q

How will changing one’s occupation to be more hazardous affect the health insurance policy in force?

A

Claim benefits will be reduced to what the premium would have bought for a more hazardous occupation.

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12
Q

Who pays the expense for an autopsy under the physical examination and autopsy provision?

A

The insurer.

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13
Q

What does the free look period allow the insured to do?

A

Return the policy for a full refund of premium within a specified time period (usually 10 days).

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14
Q

What will determine the length of the grace period in a health insurance policy?

A

The mode of the premium payment.

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15
Q

Who decides which optional provisions would be included in a health policy?

A

The insurance company.

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16
Q

If a health insurance policy has a 31 day grace period, what does that mean?

A

The policy remains in effect for 31 days after the premium is due and not paid.

17
Q

According to the reinstatement provision, once a lapsed policy is reinstated, how soon will coverage be available for accidents

A

Immediately.

18
Q

When can an irrevocable beneficiary be changed?

A

With the written consent of the beneficiary.

19
Q

What health policy provision states to whom the claim benefits must be paid?

A

Payment of claims.

20
Q

According to the time limit on certain defenses provision in health insurance policies, when can an insurer contest fraudulent misstatements on a health insurance application?

A

Anytime while the policy is in force.

21
Q

What health policy provision allows the insurer to non-renew health coverage if certain events occur?

A

Conditionally renewable.

22
Q

The insured on a health policy misstated his age on the insurance application. If this misrepresentation is discovered, what will happen to the policy?

A

The benefit amount payable under the policy will be adjusted to the insureds correct age.

23
Q

According to the rights of renewability rider for cancellable policies, all of the following are correct about the cancellation of an individual insurance policy EXCEPT

A) The insurer must provide the insured a written notice of the cancellation
B) Claims incurred before cancellation must be honored
C) An insurance company may cancel the policy at any time
D) Unearned premiums are retained bu the insurance company

A

Unearned premiums are retained but the insurance company.

24
Q

When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss. However, her agent did not notify the insurance company until 60 days after the loss. Which of the following statements correctly explains how this claim would be handled?

A) The insurer is considered to be notified since the notification to agent equals notification to the insurer
B) The insurer may delay the payment of this claim for up to 6 months
C) The insurer may settle this claim for less than it otherwise would have has the notification been provided in a timely manner
D) The insurer may deny the claim since it was not notified withing the required 20 day time frame

A

The insurer is considered to be notified since the notification to agent equals notification to the insurer

25
Q

An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued?

A) Deny any claims and cancel the policy
B) Deny paying a claim based on misrepresentation
C) Pay the full amount of a claim because the contestable period has ended
D) Adjust the claim benefit to reflect the insureds true age

A

Adjust the claim benefit to reflect the insureds true age.

26
Q

An insured submitted a notice of claim to the insurer, but never received claims forms. He later submits proof of loss, and explains the nature and extent of loss in a hand-written letter to the insurer. Which of the following would be true?

A) The insured must submit proof of loss to the Department of Insurance
B) The insured was in compliance with the policy requirements regarding claims
C) The claim most likely will not be paid since the official claims form was not submitted
D) The insurer will be fined for not providing the claims forms

A

The insured was in compliance with the policy requirements regarding claims.

27
Q

Which of the following does the insuring clause NOT specify?

A) The insurance company
B) The name of the insured
C) A list of available doctors
D) Covered perils

A

A list of available doctors.

28
Q

A guaranteed renewable health insurance policy allows the

A) Policyholder to renew the policy to a stated age and guarantees the premium for the same period
B) Policy to be renewed at time of expiration, but the policy can be canceled for cause during the policy term
C) Insurer to renew the policy to a specified age
D) Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class

A

Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class.

29
Q

Which renewability provision are you most likely to see on a travel accident policy?

A) Conditionally renewable
B) Period of time
C) Noncancellable
D) Optionally renewable

A

Period of time.

30
Q

If the insured under a disability income insurance policy changes to a more hazardous occupation after the policy has been issued, and a claim is filed, the insurance company should do which of the following?

A) Exclude coverage for on-the-job injury
B) Adjust the benefit in accordance with the increased risk
C) Cancel the policy
D) Increase the premium

A

Adjust the benefit in accordance with the increased risk.

31
Q

Under the mandatory uniform provision notice of claim, the first notice of injury or sickness covered under an accident and health policy must contain

A) A statement that is sufficiently clear to identify the insured and the nature of the claim
B) A statement from the insureds employer showing that the insured was unable to work
C) An estimate of the total amount of medical and hospital expense for the loss
D) A complete physician’s statement

A

A statement that is sufficiently clear to identify the insured and the nature of the claim.

32
Q

When Bob filled out an application for health insurance, he accidentally misstated the time period during which he was treated for acid reflux. If he had recorded this information correctly, his insurer would have charged a higher premium. When Bob is treated for erosive esophagitis 3 years after the policy’s effective date, the insurer discovers the error. Which of the following is most likely true?

A) Bob will be required to pay the “extra” premium that he would have been charged
B) Nothing, assuming that Bob’s misstatement is found to be an honest mistake
C) Bob will be required to pay all medical bills related to erosive esophagitis
D) Bob’s policy will be terminated

A

Nothing, assuming that Bob’s misstatement is found to be an honest mistake.

33
Q

The insuring clause of a disability policy usually states all of the following EXCEPT

A) That insurance against loss is provided
B) The types of losses covered
C) The method of premium payment
D) The identities of the insurance company and the insured

A

The method of premium payment.

34
Q

Under an individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is

A) Within 45 days
B) Weekly
C) Biweekly
D) Monthly

A

Monthly.

35
Q

An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?

A) Incontestability
B) physical Exam and Autopsy
C) Legal Actions
D) Time of Payment of Claims

A

Time of payment of claims.

36
Q

A man in injured while robbing a convenience store. How does his major medical policy handle the payment of his claim?

A) 50% of claim will be paid
B) If the man is not convicted, he will get 75% of his claim
C) The claim will be paid in full
D) Claim is denied if his policy contains the illegal occupation provision

A

Claim is denied if his policy contains the illegal occupation provision.

37
Q

A policy with a 31-day grace period implies

A) The policy is incontestable after 31 days of delivery
B) The policy benefits must be paid within 31 days after a claim is submitted
C) The policy will not lapse for 31 days if the premium is not paid when due
D) The policyholder may return the policy for a full refund within 31 days

A

The policy will not lapse for 31 days if the premium is not paid when due